10
Loading video...
By Billal Rahman
Immigration Reporter
0
Share
Newsweek is a Trust Project member
See more of our trusted coverage when you search.Prefer Newsweek on Googleto see more of our trusted coverage when you search.
The Trump administration has been dealt a legal setback in its effort to penalize New York over commercial driver's licenses issued to thousands of immigrants, with a federal appeals court ruling that transportation officials sought to enforce a requirement that did not exist under the regulations in effect at the time.
A three-judge panel of the 2nd U.S. Circuit Court of Appeals on Friday granted New York's challenge to a determination by the Federal Motor Carrier Safety Administration, or FMCSA, that would have withheld more than $73 million in federal highway funding from the state for fiscal 2027.
The money came from the National Highway Performance Program and Surface Transportation Block Grant Program, which support road and bridge maintenance and other transportation projects. New York state officials said withholding the funds could delay safety and infrastructure work across the state.
Read More on News
New York had been issuing nondomiciled commercial driver’s licenses, or CDLs, for five years upon initial issuance and eight years upon renewal, even when a driver’s immigration documents expired sooner. The licenses are available to certain foreign nationals living in the U.S., including DACA recipients, asylees, and refugees.
The Trump administration has cracked down on immigrant truck drivers through tighter licensing and English-language requirements as well as joint immigration and transportation enforcement. In May, federal officials said they had identified more than 30 states issuing licenses that did not comply with federal requirements, taken enforcement action against 26 states, and prompted the revocation of more than 28,000 licenses.
New York Attorney General Letitia James and Governor Kathy Hochul told Newsweek in a joint statement, “Once again, New York has defeated this administration in its endless quest to hurt New Yorkers."
“This is a win for the millions of New Yorkers who rely on safe roads to travel and for the CDL drivers who power our state's economy."
...
Over 30,000 Nondomiciled Licenses In New York
The Department of Homeland Security (DHS) said in November a three-day operation across 15 states in late October resulted in the arrests of more than 230 immigrants who federal officials said were in the country illegally, including more than 40 commercial driver’s license holders.
The agency said ICE made 4,795 CDL-related arrests nationwide between January 20, 2025, and October 28, 2026, including 1,233 arrests involving CDL holders.
New York had about 32,600 holders of nondomiciled commercial driver's licenses and learner's permits, representing roughly 7 percent of the state's active commercial licenses and permits as of July 2025, according to the court's opinion. Applicants were required to provide documentation showing lawful presence when applying.
“We've put a stop to the madness to keep the driving public safe,” a spokesperson for the Transportation Department told the Associated Press.
Licenses Valid Beyond Immigration Expiration
FMCSA began reviewing New York's licensing program in July 2025 and later determined that the state had improperly issued licenses that remained valid beyond the expiration dates on drivers' immigration documents.
In a sample of 200 nondomiciled licenses and permits, the agency found 101 remained valid beyond the expiration dates of the documents presented by applicants.
The agency directed New York to pause issuance of the licenses and rescind those it considered noncompliant. After New York challenged the interpretation, FMCSA issued a final determination in April 2026 and said it would withhold 4 percent of the state's federal-aid highway funding, amounting to $73,502,543.
Continued noncompliance could have resulted in the withholding of as much as $147 million in subsequent years.
New York argued that the federal regulations governing the licenses at the relevant time did not require states to make a CDL expire when the driver's lawful-presence documentation expired.
"The agency could not withhold federal funding based on a state's noncompliance with a regulatory requirement that did not exist," the court said.
Newsweek has contacted the Department of Transportation for comment.
Court Rejects FMCSA's Implied Argument
The court said the rules required immigrants to present valid immigration documents when applying for a commercial license, but did not require the license to expire when those documents did. Commercial licenses could generally remain valid for up to eight years.
FMCSA argued that such a requirement was implied by the regulations and would prevent people no longer authorized to live or work in the U.S. from driving commercial vehicles. The court rejected that argument, saying the requirement was not in the rules at the time.
Circuit Judge Schwartz agreed with the outcome but said the case should have been decided solely on the wording of the old regulations.
The court also noted that FMCSA later explicitly added restrictions linking licenses to immigration documents. It did not rule on the legality of those newer regulations, which are being challenged separately.
Under a final rule that took effect on March 16, 2026, eligibility for nondomiciled commercial driver's licences was restricted to foreign nationals holding one of three specified nonimmigrant classifications: H-2A temporary agricultural workers, H-2B temporary nonagricultural workers and E-2 treaty investors.
The rule also generally limits a licence's validity to one year or the expiration of the driver's authorised period of admission to the United States, whichever comes first.
The final rule is the subject of a separate legal challenge before the U.S. Court of Appeals for the District of Columbia Circuit. The court had previously stayed an interim version of the restrictions in November 2025, preventing it from taking effect.
However, in May 2026, it declined to grant an emergency stay of the subsequent final rule, allowing the new restrictions to remain in force while the broader legal challenge proceeded. The decision did not resolve the underlying question of the rule's legality.
Contact Newsweek editor on this story: Edward Pearcey.
View 0 Comments
Submit Correction
View Editorial & AI Guidelines